Amazon Adds One-Hour Pickup At All Whole Foods, Moves To Expand New Grocery Concept

Amazon is rolling out no-extra-charge grocery pickup within one hour of an order for its Prime members at all of the company's Whole Foods locations, the company announced in a blog post on Wednesday. Nationwide, there are 487 Whole Foods stores. Soon, those will be joined by more Amazon Fresh stores, as the company ramps up the store count of that concept.

The move represents a further expansion of the service for Amazon, which the company has been offering since early in the coronavirus pandemic at an increasing number of locations. The growth was in response to spiking customer demand for groceries, as well as their increasing reluctance to spend time inside stores.

"The number of Whole Food stores that you can pick up deliveries on tripled this quarter," Amazon Chief Financial Officer Brian Olsavsky said during the company's most recent earnings call in late July, referring to the quarter that ended June 30. 

"Strong early demand in groceries and consumable products continued into Q2, while demand increased during the quarter in our other major product categories like hardlines and softlines," Olsavsky said.

Even before the pandemic, however, major grocery retailers were increasing their pickup offerings.

"Amazon is late to the game," Bain & Co. partner Steve Caine, a retail industry expert, told CNBC. "They’re really trying to catch up here with those who have been at this for a while."

Amazon said pickup at its Whole Foods locations is more than just a temporary response to the pandemic. After the crisis is over, the company believes, many customers will continue to order that way due to the convenience.

"It’s clear that this offering will become a more permanent solution for many customers," the blog post noted. "In fact, more than 40% of Whole Foods Market pickup orders each month are from customers trying the service for the first time. And, according to recent data from Global Data Research, almost 68% of consumers say they will continue to use curbside pickup even when the pandemic has subsided."

Aside from expanding its Whole Foods offerings, the company is planning to grow its Amazon Fresh concept, which first opened in the Woodland Hills neighborhood of Los Angeles this summer.

Though Amazon hasn't released a precise timetable for the new stores, the company is hiring workers for new stores in the Chicago area, including in suburban Bloomingdale, Naperville, Oak Lawn and Schaumburg, Fox Business reports.

High-end Whole Foods tends to focus on organic products produced by private labels. By contrast, Amazon Fresh will feature inventory closer to standard grocers like Walmart or Kroger, including household brand names.

Amazon also recently unveiled Amazon One, a biometric technology that allows shoppers to pay at stores using their palms. Once a customer's palm and a payment method is on file with the retail giant, he or she simply pays by waving a hand over a sensor at any location using the system, Vox reports.

The company is installing the palm-reading technology first at its more than 20 Amazon Go convenience stores, starting with the brand's locations in Seattle. Whole Foods locations may eventually use palm payments as well, and Amazon is looking to sell the systems to other retailers.